The contribution of circulating hematopoietic stem cells (HSCs) to vascular dysfunction remains controversial. Our data, however, support a critical role for these cells in proper retinal repair, their dependence on hypoxia regulated factors such as stromal derived factor (SDF-1) and VEGF for their recruitment to ischemic sites, and their marked dysfunction in diabetes. We propose to test the following hypothesis: In the nondiabetic state, CD34+ cells are the primary cells responding to any ischemia or injury in the retina and engage in effective revascularization and repair within the retina. Diabetes reduces the reparative potential of CD34+ cells favoring the participation of inflammatory CD14+ cells to the repair process. However, CD14+ cells form dysfunctional vessels resulting in persistent retinal ischemia and subsequent development of preretinal neovascularization. Thus, we suggest that in diabetes, the functional balance is upset by promotion of activity of one of these phenotypes (CD14+ cells) over the other (CD34+ cells). To test the above hypotheses, we will use a unique combination of experimental approaches to integrate findings on in vitro characterization of human CD34+ and CD14+ cells modulated by hypoxia with in vivo studies using rodent models of retinal ischemia and diabetes. We propose the following Specific Aims 1) To examine the effect of hypoxia-regulated factors, VEGF, SDF-1 and IGF binding protein-3, on CD34+ and CD14+ cell attachment to, differentiation on, and invasion into advance glycation endproduct(AGE)- modified matrix proteins. 2) In CD34+ and CD14+ cells, to compare the effect of hypoxia on a) expression of VEGF receptors, SDF-1 receptor, CXCR4 and IGF-1 receptor, b) migration and c) formation of capillary tubes in the presence retinal endothelial cells using a co-culture model. 3) To examine the recruitment and integration of nondiabetic and diabetic EPCs in vivo using two models of retinal ischemia in SCID mice and examine the potential of EPCs of diabetic and non-diabetic origin to repair acellular capillaries in diabetic mice and examine the effects of hypoxia pre-conditioning on these same cells. These studies will allow us to carefully examine the contribution of these two key endothelial precursor cell populations to the proper vs. aberrant repair of the retinal vasculature. [unreadable] [unreadable] [unreadable]